On his own, but not alone

Matt Sledge makes arrangements for the silent auction on July 30 in LaVergne, Tenn.

If you were at the 2008 ISN Tool Expo in June and attended the distributor panel, then you
already know a little about Matt Sledge, an independent mobile tool dealer from Murfreesboro,
Tenn. Matt was the youngest distributor on that panel, had plenty to say and plenty of energy
for the early hour of the Saturday panel discussion.

On his daily route, that same energy
continues to bubble over when he’s selling to
customers. Matt has been a distributor for about seven years, five with one of the brands
and now nearly two years on his own.

Well, not really on his own. Whereas many distributors
have help from their families from washing the truck to inventory, billing and more, Matt’s
wife, Shannon, will actually drive his truck and do his route on days that he is unable to,
whether sick, at a tool show, etc.

Shannon
admits, though, that she concentrates much more on collecting than selling when she’s
on the truck.

“I sell, but he’s a better salesman,” Shannon said. “I’m
always hardcore [collecting]. I mean, when a guy says, ‘I don’t have any money,’ I
say, ‘Are you really going to tell a woman that you don’t have any money?’ ”

Shannon
has even done Matt’s route for a full week. A self-described “motorcycle
nut” (he previously worked in a motorcycle dealership on the tech, parts and sales
sides), he went to Daytona Bike Week in two of his early mobile years, and Shannon ran the
route each time.

“The thing about this business, if you don’t run it, nobody’s
going to,” Matt
said of how lucky he feels to have Shannon helping out. “She’ll run it, maybe
five days out of the whole year.”

One of Matt’s keys is consistency, as with any
successful distributor, and that’s
a big part of the help Shannon offers — being consistent.

“It means something
to the guys,” Matt said. “You show up at the same place
at the same time on the same day. They’re going to buy from you, because they know
you’re going to be there.”

Matt still uses some of the techniques he learned as
a branded dealer, saying the “training
time” of being with a brand helped, but wasn’t essential. He does feel that a
sales background can help more than a tech background on the truck.

“I think I could’ve
come out the door and did it straight as an independent, but I don’t think it’s
for everybody,” Matt said. He recommends all mobile
tool dealers take some sales classes or seminars every year to continue advancing their businesses.

“I
said this in the small group at the ISN show, that if any of the guys out there have the
opportunity to take a sales class in their business, take as many as you can, because that
stuff really does work,” Matt said.

“Sales is a psychological business.”

CONTESTS

Matt runs several contests to keep customers interested. Past events
have included raffles and T-shirt giveaways. One recent promotion involved a toolbox giveaway.

“I’ve
already made my money on the deal,” Matt said of taking the used
toolbox in on a trade. He wasn’t keen on the idea of selling it to somebody and taking
two years at $40 a week to be paid off.

“I brainstormed with Joe Knight, my ISN salesman,” Matt
said. “I decided
I’d just as soon sell 160-180 items that have a $25 markup on them.” Anyone who
bought one of the three under-$100 items, an EZ Red clip light, GearWrench four-piece extended
screwdriver set, or a 42-piece screwdriver set, received a raffle ticket for the toolbox.

“These
things are flying off the shelf. I’m selling two or three items per stop,
everywhere I go,” Matt said.

But Matt doesn’t keep contests going all the time.

“They stop hearing the pitch, and it takes [time] for me to run a cycle on something,
and actually get paid back what I’ve invested,” he said. The money comes right
back for those who pay in full immediately.

“But then, somebody’s going to put
it on their account that already owes $300, and it’s going to take a little while for
that [money] to come back in.”

GOING INDEPENDENT

Matt buys the majority of his tools through ISN, and some
from Medco. He touts his relationship with salesperson Knight at ISN as key.

“The reason
I do business with ISN is because of the relationship I have with the one salesperson,” Matt
said. “I talk to this guy, all day, every day.”

Last year, Matt’s tool sales
were near $375,000, about $75,000 more per year than before he went independent. He does
admit that before going independent, he was already selling a lot of competing brands.

“My
last year … I realized I was making more money selling independent then
selling the [branded] stuff.

“And I’m not interested in working for anybody.
That’s the reason I got
out of that, I wanted to be all driven by myself. … the direction, it’s different,” Matt
said.

Being the main driver, and the lone employee, in his business is what attracted Matt
to the tool business to begin with. After saving investment money, he started looking into
different franchise opportunities.

“I was looking to buy an oil change place, looked
into buying a Subway franchise. And all these things with employees started hitting my head.
If you’ve got an oil change
place, you’ve got $7-an-hour guys working for you, so they’re going to make a
mistake, which is going to cost you money in the long run. Subway, you’ve got all this
food stuff going on.

“I started looking for a business that I could buy, that would
pretty much run on just me. A guy that bought a motorcycle from me, came in and said, ‘Man,
you need to get into the tool business.’ ”

After about three months, “I
drove to Alabama to look at my first tool truck. When I saw it, I was like, ‘That’s
me. I gotta do it.’ ”

He paid off his truck in less than two years and was solid
with his tool account within a year. One thing Matt does not like is debt.

“I don’t
think it takes a $100,000 tool truck to make $400,000 a year,” Matt
said. “I know a guy who spent $115,000 on a tool truck. That depreciates. I can buy
a house for $130,000 that goes [up].

“I paid $20,000 for this truck,” Matt said
of his second truck since coming into the business.

When it comes to filling his truck, he
likes to keep it full, packed, with tools, even at the expense of the space required for
toolboxes.

“I hate toolboxes … tying somebody’s money up and then it takes
them so long to pay for it,” said Matt. “If I could fill my truck up with nothing
but shelves, I’d rather just sell tools.

“But I kind of have to do the whole toolbox
thing,” Matt said, which is in fairness
to his customers that look to him for a choice beyond the franchise brands’ boxes.

“I
do have good customers that want toolboxes, and I do have good customers that are going to
pay for them. I don’t need to cut them short of not having that service,” Matt
said. “And I have done pretty well with Mountain and their toolboxes.”

As far
as actual tools go, Matt looks to order the same amount as he sells each week. Because space
gets tight in an 18’ truck, he keeps some overflow tools at home, and more at
a customer’s shop.

“Between my home and that shop, I’m only about 10 miles
away from replacing anything I might need at any time,” Matt said.

COLLECTIONS

Even though everything else is going well, there is one main
downside to the business for Matt.

“The only thing that would ever drive me away from
the tool business is the collections. … I
guess it’s the let-down of thinking that you’ve got a good relationship established
with somebody, and them not following through with what they said they were going to do.

“I
follow through with what I’m going to do,” Matt said. “That’s
the hard part about it.” Some of it is skips, though not all of it.

“I sold somebody
an air ratchet one week, and the next week the guy got fired. … He
lived in ‘Hole-in-the-wall’ Tennessee.

“I jumped on my motorcycle, drove
to his house, and picked it up.

“District managers will tell you to blow it off and
go sell something else. I don’t
blow it off, I take it pretty personally.”

Beyond skips, Matt wants his customers to
be up-front with him.

“People that don’t pay me on a week-to-week basis with
problems, that just kind of rolls off my shoulders.

“It’s the people that owe
me $300, $400, $500” and won’t pay anything
and duck around that get to him.

“I try to shoot a $20 bill for every $100 I sell … but
I’m not real, real
picky, and I think that’s why I get a lot of guys’ business. I ask for the bare
minimum, 10 percent, every week. If you can’t pay me 10 percent, I don’t want
to do business with you.

“I try to get 20 percent, but bare minimum 10 percent,” Matt
said. “And
they all know that. I don’t get run over much on my collections. I’m pretty known
for going after them.”

Matt has about 325 active customers every week and shoots for
$1,000 in collections and sales each day to be in his “comfort zone.”

Matt runs credit cards for his customers at the same time each week so they
know when to plan for it.

“I usually cash a lot of checks on Fridays, and take a little
extra cash,” Matt
said. “If their check is $258 and some change, I’ll usually keep the $58, $48,
whatever it is … as their payment.”

It’s the basics that keep Matt’s
business running strong.

“Hit the store on time, be there every week, collect on your
payments like you’re
supposed to and treat the guy like you want to be treated, and you’re going to have
a successful business. … A lot of the stories are similar, but it’s the small
quirks” that set each distributor apart, he said.